TSAMTO - The two governments of Southeast Asia - Indonesia and the Philippines - have announced significant increases in defense spending for 2013 fiscal year.

According to "Jane's Defence Industry," The Cabinet of Ministers of Indonesia announced an increase in the budget of the Ministry of National Defense to 76.54 trillion rupiah (8.1 billion dollars), which is 18% more than in FY 2012

Department of Budget and Management (DBM) said the Philippines July 19 on the allocation of the Ministry of National Defense 121.6 billion pesos (2.9 billion dollars) - an increase of 12.5% ​​compared to FY 2012

According to the Department's Budget and Management, the Philippines, the 47.2 billion pesos allocated to the article "internal security" and 2.1 billion pesos - the "territorial defense initiative."

Armed Forces of the Philippines in the arms procurement program (CUP-Capability Upgrade Programme) will also receive five billion pesos, which will be used to purchase critical equipment, boats and airplanes.

As part of the CUP in the next few years will be a series of acquisitions of military hardware. In particular : air-and sea-based missile system, various types of helicopters, patrol aircraft, medium-sized military transport aircraft and combat-capable aircraft.

According to the President Benigno Aquino on July 23, the program has allocated more than the administration CUP 28 billion pesos. Projects worth another 75 billion pesos in the forwarded to the Parliament. These funds will be spent over the next five years.

In addition to the costs of the defense budget and the Department of Planning will provide Philippine Coast Guard (which reports to the Department of Transport and Communications) funds amounting to 1.8 billion pesos, a 62% increase compared to FY 2012

Ministry of Interior and Local Government allocated 120.8 billion Philippine pesos (an increase of 21%).

The Cabinet Office did not disclose Indonesia expenditure for the purchase of military hardware, though, as you know, they include fighter aircraft, transport aircraft, frigates, maritime patrol boats, helicopters, and several types of anti-aircraft missile systems.

Despite the increase in defense spending, accounting for a small percentage of the gross domestic product of Indonesia allocates to defense about 0.8% of GDP, Philippines - about 1.1%. At the same time, both countries have in recent years have seen the compensation inadequate funding of defense spending from extrabudgetary sources.

China and Indonesia have started talks on the ambitious local production of C-705 anti-ship missiles
as part of Indonesia’s efforts to achieve independence in weapons production.

The defense cooperation reflects strengthening ties between both countries amid heightening tension in the South China Sea involving China and a number of Indonesia’s ASEAN neighbors.

Defense Ministry chief spokesman Brig. Gen. Hartind Asrin said that the initial talks were conducted during the first China-Indonesia defense industry cooperation meeting held in Jakarta on Wednesday.

The ministry’s defense potential director general Pos M. Hutabarat hosted the Chinese delegation which was led by Liu Yunfeng, a deputy director general at the Chinese State Administration for Science, Technology and Industry for National Defense (SASTIND).

“The meeting discussed various efforts to improve cooperation between the defense industries of both countries,” Hartind said on Thursday. “We’ve already prepared an area for the [missile] production site that faces the open sea for trials.”

Hartind said the C-705 had a range of 120 kilometers.

He said that the Indonesian Navy had successfully test-fired the C-705 missiles in the Sunda Strait.

“China has also offered to donate weapons systems that Indonesia might need,” he added.

A source said that Indonesia was expected to reply to Phase 1 of the missile proposal at the end of August and Phase 2 one month later. A contract is expected to be signed in 2013.

Phase 1 is on semi-knocked down production while Phase 2 is on completely-knocked down production.

A proposal for a Phase 3 on research and development is already on the table although the focus is currently on the first two phases.

Aside from the missile production, a number of Indonesian Army Special Force Command (Kopassus) members recently conducted the second “Sharp Knife” joint exercise with Chinese Special Forces operatives earlier this month in Jinan, Shandong, China.

China has also offered to train 10 pilots from the Indonesian Air Force to train using a Sukhoi simulator in China.

Commenting on the defense cooperation, defense expert Andi
Widjajanto said the industrial cooperation was solely to gain access to more advanced technology.

“However, it will take a long time for us to be independent in the defense industry, perhaps after 2024. This is the reason Indonesia builds partnerships with many countries that possess modern military technologies,” he said. “This is also why we require partner countries to transfer their technologies to us in any agreement we sign with them.”

Andi added that there were two goals in terms of the partnership: to access advanced rocket technology, and to collaborate in upholding maritime security, which began when President Susilo Bambang Yudhoyono signed an agreement in March during a state visit to Beijing.

“I don’t believe it has anything to do with conflicts in the South China Sea,” he stressed.

Meanwhile, chairman of the House of Representatives’ Commission I on defense issues, Mahfudz Shiddiq, said such global partnerships in the defense industry were designed to develop Indonesia’s own industry.

“We have allocated Rp 150 trillion [US$15.8 billion] to modernize our weapons-defense system from 2010 to 2014. It would be wasteful paying such a huge amount to foreign defense industries without any attempt to improve our own,” he said.

“Therefore, we require partner countries to transfer their military technologies in the hope that they will gradually improve our own technologies.”

He added that the partnership with China was due to its advanced military technologies in fields such as rocketry. “This is not political, even though others might link the partnership to political issues, for example the South China Sea disputes,” Machfudz said.

Indonesia already cooperates on weapons production with several other countries including South Korea to build jet fighters and submarines, the Netherlands to build frigates and Spain to build medium transport aircraft.